TSMC is fast expanding capacity for 5nm process to meet strong demand from a host of heavyweight clients, including Apple, AMD and MediaTek. The foundry house's capacity for 5nm process is expected hike by one third in second-half 2021 compared to that in the last quarter of 2020. MediaTek has also obtained more capacity support from TSMC for chip production at 6nm and 7nm to facilitate its 5G chip shipments. Meanwhile, ODM Wistron and Taiwan's Chunghwa Telecom have teamed up eyeing the 5G and AI services sectors.TSMC 5nm process capacity to top 120,000 wafers monthly in 2H21: TSMC is poised to scale up its 5nm process manufacturing capacity to 105,000 wafers monthly in the first half of 2021, up from 90,000 units in fourth-quarter 2020, with plans to further expand the process capacity to 120,000 units in the second half of this year, according to industry sources.MediaTek wins more TSMC support to boost 5G chip shipments: MediaTek has obtained sufficient 6nm and 7nm process capacity at TSMC, which will allow the mobile SoC specialist to boost its 5G chip shipments in 2021, according to industry sources.Wistron, Chunghwa Telecom team up to tap 5G, AI service sectors: Wistron Group has forged a strategic alliance with Chunghwa Telecom (CHT) to jointly tap business opportunities arising from proliferating 5G and AI applications.

IC manufacturing capacity has been tight, resulting in chip shortages that some expect to last into 2020. Shortages amid strong demand are sending product prices up - one of those being MOSFET whose suppliers are set to hike pricing sharply in the months ahead. Demand for passive components is expected to remain strong through second-half 2021, with currently inventory at ODMs and distributors dropping to very low levels. Chip shortage likely to persist through 2022, says Silicon Motion: Foundry and backend capacity constraints resulting in a global shortage of semiconductors will likely persist through 2022, according to Silicon Motion Technology, a Taiwan-based NAND flash device controller specialist.MOSFET prices poised to rise on worsening shortages: Prices for MOSFET chips are set to rise significantly in the months ahead thanks to worsening shortages arising from persistently tight 8-inch foundry capacity and rapid increases in demand for graphics cards and automotive electronics applications, according to industry sources.Passive component makers see clear order visibility stretch into 2H21: Yageo and Walsin Technology have seen their visibility of orders for MLCCs, chip resistors, inductors and capacitors extend to the second half of 2021 thanks to ODMs and distributors strengthening order momentum to replenish their inventories, according to industry sources.

Unusually low rainfalls in Taiwan over the past year have resulted in water shortages, particularly in the southern parts of the country. Some companies at the Southern Taiwan Science Park, including TSMC, have started buying truckloads of water to make up for the shortfall from reservoirs, apart from stepping up conservation measures. TSMC is set to move 4nm process to volume production in 2022, which may prompt Qualcomm to place foundry orders for its next generation mobile chips. Stronger-than-expected demand from 5G and automotive chip segments is sending MLCC pricing up.Taiwan chipmakers moving to counter water shortages: Chipmakers including TSMC and UMC have started buying water by the truckload for their foundries in Southern Taiwan Science Park (STSP), as reservoirs in southern Taiwan face dwindling water levels following months of scant rainfalls, according to industry sources.Qualcomm may switch to TSMC 4nm node in 2022: Qualcomm will continue to fabricate its next-generation 5G mobile chip, tentatively dubbed Snapdragon 895, at Samsung Electronics built using an upgraded 5nm process, but may switch to TSMC in 2022 using its 4nm process, according to industry sources.High-capacitance MLCC prices set to rise: MLCC vendors including Samsung Electro-Mechanics (Semco) and TDK are likely to raise their quotes for high-capacitance MLCCs in response to stronger-than-expected demand for 5G handset and automotive applications, according to channel distribution sources.

Tesla is expected to sell 800,000 electric vehicles (EV) globally in 2021, increasing 60.1% on year, and the more price-friendly Models 3 and Model Y will together take up 90.4% of the volume, Digitimes Research forecasts.Tesla sold nearly 500,000 EVs for a global market share of 16% in 2020. Nearly 140,000 units of Model 3 were sold in China for a EV market share of 11% and nearly 88,000 units in Europe for a 6% in 2020.Tesla has brought in handsome revenues from sales of software consisting of FSD (full self-driving) kits, payable OTA (over the air) functional upgrades, subscription-based infotainment services.For FSD, the major source of software sales revenues, Tesla initially offered hardware/software-integrated ADAS kits in 2014 and had kept upgrading them until it offered initial FSD in early 2019. FSD/AP HW3.0, the latest FSD version featuring support to Level 5 autonomous driving, was launched in October 2020.In line with autonomous driving technology development, Tesla plans to establish Robotaxi Network to operate rental self-driving taxicabs, as its new business model.

The frigid weather that halted production in the US state of Texas may prompt IDMs to mull adjusting outsourcing strategies. Seeking more support from manufacturing partners, particularly those in Taiwan, may be a way for IDMs to diversify risks in an IT sector that has been haunted by uncertainty and tight supply. Fabless IC vendors have been troubled by insufficient supply from foundry partners, but some of them who have backing from well-established parent cormpanies, such as UMC-affiliated IC design houses, have been better off than others. In the notebook sector, the top-5 brands and top-3 ODMs saw shipments drop in January due to seasonality and components shortages, according to Digitimes Research. IDMs may evaluate more outsourcing: IDM vendors may consider outsourcing more of their production starting 2022, with Taiwan-based contract chipmakers being among the beneficiaries, according to industry sources.IC design houses with strong backing more capable of winning foundry support: Taiwan-based IC design houses backed by large-scale and well-established parent companies, such as LCD driver IC firms Fitipower Integrated Technology and Raydium Semiconductor, will be more capable of mitigating the impact of increasingly tight capacity at foundries in 2021, according to market sources.Top brands and ODMs see January notebook shipments decline: After hitting a new high in monthly shipments last month, the global top-5 notebook brands saw their combined shipments slip more than 10% sequentially in January due to seasonality and the fact that component shortages have shown no improvement.

The application of Open RAN (O-RAN) networks is gaining popularity worldwide, offering plenty of opportunities for Taiwan-based makers to tap into the niche market by optimizing their capabilities in the manufacture of semiconductor and electronics products.The impetus pushing forward to using O-RAN networks in Europe comes after Vodafone, Deutsche Telekom, Telefonica and Orange signed an MoU in mid-January to promote the O-RAN. Telecom Italia also joined the initiation in early February.The initiation, which also calls for support from the EU and other governments, aims to build a local O-RAN industry supply chain and an ecosystem that will include testing laboratories and demonstration fields to incubate innovative O-RAN applications.Most European telecom players favor releasing relevant orders to established telecom equipment suppliers and 5G software companies through biddings, and therefore, Taiwan's O-RAN device makers may cut into related supply chains by cooperating with telecom equipment providers, Digitimes Research believes.There is already an established O-RAN supply chain in the US. The supply chain players include: RAN software providers Altiostar and Mavenir; cloud platform management firms Red Hat and VMWare; and hardware and software system provider Cisco Systems. They also include chipmakers Intel, Xilinx and Nvidia as well as cloud operators such as Facebook, Google and Microsoft.By optimizing their manufacturing capabilities, Taiwan's firms can complement US firms to realize related product development and solutions.In Asia, NTT Docomo is teaming up with NEC and Fujitsu to tap the enterprise private O-RAN network market.The NTT Docomo team is tying up with Thailand-based AIS and a number of Japan-based firms to form a 5G Global Solution Consortium (5GEC) to promote the use of O-RAN and related 5G applications by Thailand's manufacturing and construction firms initially.Taiwan's firms can cooperate with the 5GEC to help build enterprise private O-RAN networks, optimizing Taiwan's large-scale manufacturing capacity and its digital application technology and Japan's expertise in high-precision machinery, components and materials.

After hitting a new high in monthly shipments last month, the global top-5 notebook brands saw their combined shipments slip more than 10% sequentially in January due to seasonality and the fact that component shortages have shown no improvement.Hewlett-Packard (HP) had better shipment results than its peers in January due to increased shipments of consumer models and Chromebooks. Lenovo saw a sharper decline sequentially than competitors in the month as seasonality had a major impact on the Chinese brand's entry-level to mid-range product shipments, Digitimes Research's numbers show.Dell's shipments went down nearly 20% on month due to unsatisfactory sales of Windows-based models and Chromebooks in the enterprise segment.The top-3 notebook ODMs together witnessed an 18% on-month decline in January shipments. Wistron's shipments dipped only less than 10% on month thanks to Dell increasing the proportion of its outsourcing to the ODM.Notebook shipments to decline on month in JanuaryPhoto: Digitimes file photo

Major chip vendors have been striving for support from production partners, and Qualcomm reportedly will even appoint a VP dedicated fully to working to secure capacity in Taiwan. Qualcomm and MediaTek are also said to be both stepping up orders for BT substrates to faciliate their shipments of 5G handset APs and mmWave AiP modules. In the server sector, the frigid weather striking Texas and some parts of Mexico has disrupted production at ODMs, but demand in 2021 will remain robust.Qualcomm gearing up to cement capacity support from Taiwan partners: Qualcomm has been gearing up to seek multiple supply sources for both silicon-based and III-V semiconductors amid increasingly tight capacity at the global IC value chain, and reportedly will install one vice president working exclusively to cement support from production partners in Taiwan, according to industry sources.Chipmakers placing extra orders for BT substrates amid tight supply: As supply of high-end BT substrates has turned tight in the first quarter of 2021, major chipmakers including Qualcomm and MediaTek are moving aggressively to secure more capacity support from Taiwan IC substrate makers to meet increasing demand for 5G handset APs and mmWave AiP modules in the months ahead, according to industry sources.Server supply from North America disrupted by cold weather: Server supply from Mexico, a major production hub for Taiwanese ODMs, is expected to be undermined by the recent frigid weather hitting the northern part of the country and the US state of Texas, according to sources from the upstream server supply chain.

Automakers are desperate for support from foundry partners to ease chip shortages disrupting their production, and they are willing to pay extra in return for foundries giving top priority to their orders. TSMC has agreed to give automotive chip orders SHR (super hot run) status. But more support from Taiwanese foundries may not be enough to ease their trouble, which has now been compounded by the frigid weather in the US state of Texas that has halted production at wafer fabs there. Taiwan's top-3 foundry houses are expected to see their overall sales hit a record level in 2021, according to Digitimes Research.TSMC agrees to rush shipments to automotive chip customers: TSMC has agreed to give top priority to orders placed by its automotive chip clients, giving them SHR (super hot run) status, according to sources at Taiwan-based analog IC firms.Winter storm in US to disrupt chip supplies: The impact of winter storms that struck the US state of Texas could be significant on the world's supply of certain semiconductors, including high-end NOR flash and chips demanding 8-inch wafer fabrication, according to industry sources.Taiwan top-3 foundries to see combined revenue hit another record high in 2021, says Digitimes Research: Combined revenue of Taiwan's top-3 pure-play foundries are expected to rise 17% on year to top US$60 billion in 2021, Digitimes Research estimates.

Combined revenue of Taiwan's top-3 pure-play foundries are expected to rise 17% on year to top US$60 billion in 2021, Digitimes Research estimates.TSMC, UMC and VIS saw their combined revenue climb to a record high of US$52.69 billion in 2020, Digitimes Research has found.The top-3 Taiwan-based foundries generated a combined US$14.58 billion in the fourth quarter of 2020, up 4.4% sequentially and hitting a record high. Their combined revenue is forecast to grow another 1.7% on quarter to US$14.83 billion in the first quarter of 2021, as demand propelled by coronavirus-induced stay-at-home initiatives remains strong. A pick-up in demand for automotive chips, as well as rising wafer ASPs, are other growth drivers.In addition, TSMC, UMC and VIS will see their planned capex this year reach a combined US$28 billion, of which TSMC's account for the majority. In 2020, their combined capex came to US$18.3 billion - already a record high, according to Digitimes Research.